While the joint venture between Walt Disney Company’s ESPN, Fox, and Warner Bros. Discovery to launch a new sports-centric streaming service may not be blocked by Congress nor the Federal Communications Commission, there are enough vocal companies affected by the deal that it could see some hurdles.
That’s the opinion of Blair Levin, a former FCC official and now analyst at New Street Research, who published a note saying companies like Comcast, Paramount Global, sports leagues, network affiliates, and even other bidders for sports rights may try to block the joint venture or pitch their own to “regain lost leverage.” Light Reading was the first to spot the note. If such companies move to raise a fuss, the FCC could likely have a reactionary hearing prompted by major providers.
Levin said the deal so far doesn’t require a response or any approval from the FCC. However, if pushed, the agency could encourage more oversight and “ultimately lead to a government reaction.”
The joint venture between the streamers doesn’t constitute a reduction in competition as the companies are “rebundling” content from other services.
However, streaming platforms and broadcast operators have voiced concerns about the joint venture. Fubo, which offers live sports, released a statement last week expressing its hesitations about the new platform offering similar content to its own.
“Every consumer in America should be concerned about the intent behind this joint venture and its impact on fair market competition,” the statement reads. “This joint venture spotlights a concerning trend where an alliance with significant market share, reportedly controlling 60-85% of all sports content, could dictate market terms in a manner that may not serve the broader interests of consumers.”
Fubo CEO David Gandler and Grant Spellmeyer, CEO of cable trade group ACA Connects both said they would want to the JV reviewed over antitrust concerns.
The new sports platform proposed by ESPN, FOX, and Warner Bros. Discovery is scheduled to launch this fall. It will offer 14 live channels with content from all major professional and college sports leagues, including the NFL, NBA, MLB, and NHL. The service will host linear sports networks, including ESPN, ESPN2, ESPNU, SECN, ACCN, ESPNEWS, ABC, FOX, FS1, FS2, BTN, TNT, TBS, truTV, and ESPN+. Subscribers can also bundle the service with Disney+, Hulu, and/or Max.
While it could be a perk for fans who are weary of switching platforms to catch every game, it’s a concern for competitors. Fubo isn’t the only company expressing concern over the joint venture, and some are wondering if it hinders competition and goes against anti-trust rules. Cable TV providers are also squirming as industry experts predict the platform could cost $30-$50, significantly cheaper than most cable TV sports packages, and runs less than Fubo or YouTube TV, which also streams live sports.
“You don’t need a crystal ball to see this proposed juggernaut will abuse market power to siphon off fans and stick them later with higher bills to access sports,” said Spellmeyer said.
However, Disney CEO Bob Iger said the platform wouldn’t take away from its linear channels, and so far, the FCC has not made a move to interfere.